I’m not sure that writing about Laidlaw/LLEG has any relevance since it appears that Laidlaw/Bartoszek has sold(?) his interest in the Berlin Station biomass plant. I say “appears” since the details of what has transpired between Cate Street Capital and Laidlaw are sketchy at best and, Mr. Bartoszek has not shared that information with too many people, not even with his shareholders. As I’m sure most of you know, a couple weeks ago the Securities and Exchange Commission pulled the plug on all trading of Laidlaw stock for reasons still quite unclear, but certainly serious. Last Tuesday 6/21 the SEC gave the green light for the sale of shares to resume on the “grey” market (which I know nothing about”, but “grey” appears to be one step below the “penny stock/pinks” Not knowing what “greys” are all about is also a problem for many of the shareholders who are scrambling around to see what their options are and figure out how much money they’ve lost. On Tuesday when Laidlaw shares were once again being traded, the value of LLEG dropped a whopping 80% with a whole bunch of investors dumping their shares for a fraction of what they had paid and in fear that the values could go down even further. There’s wild speculation on several shareholder blogs with emotions running high. I’ve been keeping an eye on the I-HUB site and I’ll close this post with quotes I’ve cut and pasted over the past couple days. “I just got home can't believe I got 500k more at .001 Weeeeeee.” “Whether "if it makes sense or not it's called the SEC's new task force on "microcaps". As usual they are several years late to the party, but in the long run it should help "retail investors" It will either kill LLEG or make them stronger only time will tell.” “Only if would have been lucky enough to match with a buyer. But you are missing the fact that there was a number of consistant trades today around .001, 80% down. Your stock and mine is now worth 20 cents on the dollar from the last day it traded. lets see how many trades we get above .0015 tomorrow”. “as stated before, i wouldn't buy any Grey Sheet stock including LLEG. i don't believe in flushing money down the toilet.”
"just because LLEG has engaged a big auditing firm does not mean that a successful audit that doesn't uncover improprieties will be the result."
“It does hoever mean they have parted company with their previous audit firm, which in itself is a huge red flag, as anyone who has experience of Pink Sheets scams knows well.
Indeed if LLEG were a reporting company then they would need to furnish a letter from the outgoing auditors confirming that their departure was unrelated to any issues with LLEG's business. As a "dark" Pink Sheet, there is no requirement for them to do so.
Always easier to get rid of an auditor who asks too many awkward questions, and start with a new one hoping you can pul the wool over their eyes.
Indeed, it's entirely possible that the old audit company, Gruber & Co. LLC, were the ones who alerted SEC to something they found when reviewing LLEG's accounts that led to the very serious and not-lightly-taken step of suspension.
Interestingly while the item on LLEG's news release page does link to the Marcus website:
http://www.laidlawenergy.com/News
on right”
"NEW 6/22/11 Laidlaw Energy engages Marcum, LLP as new auditor"
there seems to be no link to a complete PR, and there is no official release from the company on the newswires.
Which is odd.
Hey fellow bloggers,
Think some congrats are in order here....
Twitter
wood2energy NH PUC approves Berlin Station #biomass amended PPA, denies IPP motion for re-hearing. Next stop? - NH Supreme Court or start building?
about 1 hour ago
Posted by: egrohs | June 23, 2011 at 05:36 PM
STATE OF NEW HAMPSHIRE
PUBLIC UTILITIES COMMISSION
DE 10-195
PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE
Petition for Approval of Purchased Power Agreement with Laidlaw Berlin BioPower, LLC
Order Denying Motion for Rehearing Filed by Wood IPPs, Granting Withdrawal of
Document Filed by Edrest Properties, and Addressing Compliance with Conditions Set
Forth in Order No. 25,213
O R D E R N O. 25,239
June 23, 2011
I. PROCEDURAL BACKGROUND
In this order we address two motions for rehearing of Public Service Company of New
Hampshire, Order No. 25,213 (April 18, 2011) and consider whether the Amended and Restated
Power Purchase Agreement (Amended PPA) filed by Public Service Company of New
Hampshire (PSNH) complies with the terms of Order No. 25,213. Order No. 25,213 contains a
detailed procedural history of the docket that is not repeated here except as appropriate to explain
our rulings.
In Order No. 25,213, we concluded that a proposed Power Purchase Agreement (PPA)
between PSNH and Laidlaw Berlin BioPower, LLC (Laidlaw) for the acquisition of energy,
capacity, and renewable energy certificates (RECs) was not in the public interest as filed, but
approved the PPA on condition that PSNH file a revised PPA complying with the terms of the
Order within 30 days. On May 18, 2011, PSNH filed an unexecuted version of the Amended
PPA that PSNH asserts complies with the terms set forth in Order No. 25,213.
DE 10-195 - 2 -
On May 17, 2011, Bridgewater Power Company, L.P., Pinetree Power, Inc., Pinetree
Power-Tamworth, Inc., Springfield Power LLC, Whitefield Power & Light Company, and
Indeck Energy - Alexandria, LLC (collectively the Wood IPPs) filed a motion for rehearing.1
The motion for rehearing was timely filed pursuant to RSA 541:3 and N.H. Code Admin. Rules
Puc 203.33. PSNH and the City of Berlin filed objections to the motion for rehearing on May
24, 2011.
Intervenor Edrest Properties, LLC (Edrest) also filed a motion for rehearing, on May 18,
2011, and on May 27, 2011 asked the Commission to withdraw the motion. On June 6, 2011, the
Office of Consumer Advocate (OCA) filed a letter setting forth several concerns in connection
with the Amended PPA. On June 6, 2011, PSNH responded to the concerns raised by the OCA.
Pursuant to RSA 541:5, the commission issued a secretarial letter on May 25, 2011 suspending
Order No. 25,213 pending a decision on the motion for rehearing and determination of
compliance of the Amended PPA with the terms set forth in such order.
II. WOOD IPPS
A. Motion for Rehearing
The Wood IPPs request that the Commission rehear Order No. 25,213 and issue an order
consistent with the arguments raised in their motion and applicable to any compliance filing
made in this docket. Motion for Rehearing at 22. Among other things, Order No. 25,213
included our ruling on the Wood IPPs’ motion for rehearing of Order No. 25,192 (January 14,
1 Also on May 17, 2011, the Wood IPPs filed with the Commission a copy of the RSA 541:6 notice of appeal they
filed with the New Hampshire Supreme Court. The legal issues raised in the notice of appeal are among the issues
raised in the Wood IPPs’ motion for rehearing. We conclude that the Wood IPPs decision to file the notice of
appeal does not foreclose us from acting on their motion for rehearing.
DE 10-195 - 3 -
2011), in which we denied a motion to dismiss filed by the Wood IPPs on December 15, 2010,
and addressed the Wood IPPs’ arguments made in their closing statement.2
The Wood IPPs make two major arguments, each with several subparts. First, they argue
that Order No. 25,213 is unlawful, unjust and unreasonable because it incorrectly determines that
the REC purchase obligation extends past 2025, authorizes PSNH to enter into a REC purchase
agreement whose terms extend beyond 2025, and allows PSNH to recover from ratepayers the
cost of RECs acquired after 2025. Id. at 2. They maintain that a plain reading of RSA 362-F:3
demonstrates that, absent further legislative action, the REC purchase obligation ends in 2025.
Id. at 3. They contend that the Commission erred in reviewing legislative history to hold that a
REC purchase obligation exists beyond 2025. Even so, they argue that legislative history
demonstrates that the REC purchase obligation ends in 2025. Id. at 4.
The legislative history they identify in support of their contention is a provision in Senate
Bill 314 filed in the 2006 legislative session. Senate Bill 314 proposed a renewable portfolio
standard (RPS) for the state; it contained a table that expressly provided a yearly REC purchase
obligation for years through 2013 and a “thereafter” obligation for the years following 2013.
Senate Bill 314 was voted inexpedient to legislate in the House of Representatives; the following
year, however, new legislation to create an RPS for the state, House Bill 873, became law,
codified at RSA Ch. 362-F. The statutory language did not contain the word “thereafter”.
According to the Wood IPPs, the absence of language creating an RPS program of indefinite
duration was purposeful and differentiates the New Hampshire RPS program from the RPS
programs of other states. Id. at 7. The Wood IPPs further maintain that the Commission’s rules
2 The Wood IPPs’ first motion for rehearing and their closing statement were both filed with the Commission on
February 14, 2011.
DE 10-195 - 4 -
implementing RSA 362-F, Puc Ch. 2500, sets forth REC purchase requirements only for the
years 2008 through 2025. Id. at 9. In the Wood IPPs’ view, Order No. 25,213 erred by, in
effect, adding words to the statute that the drafters specifically removed.
The Wood IPPs further assert that an end of the REC purchase obligation in 2025
harmonizes with the remainder of the statute and does not result in an absurd or unjust result. Id.
at 11. Citing Public Service Company of New Hampshire, Order No. 24,945 (Feb. 27, 2009), the
Wood IPPs argue that the reason for Commission approval of multi-year agreements under RSA
362-F:9 is to allow the petitioning electric distribution utility to recover the prudently incurred
costs of such agreements. The Wood IPPs maintain that application of the plain meaning of
RSA 362-F:3 and 362-F:9, I would prohibit the Commission only from pre-approving for rate
recovery multi-year agreements that exceed the extent of the compliance requirements set forth
in RSA 362-F:3, meaning that distribution utilities would have to demonstrate the prudence of
such speculative purchases after the fact, such as in PSNH's energy service rate proceedings.
According to the Wood IPPs, a distribution utility, like any other retail provider of electricity
subject to the statutory REC purchase obligation, must bear the risk of recovering the costs of
REC purchases that exceed the statutory RPS compliance requirements. Id. at 12.
In addition, the Wood IPPs contend that applying RSA 362-F:3 as written does not
require the Commission to place a "temporal restriction on multi-year agreements not stated [in
RSA 362-F:9, I]," see Order No. 25,213 at 74-75. They emphasize that the restriction is
explicitly stated in RSA 362-F:9, I, i.e., that the Commission may only authorize entry into
"multi-year purchase agreements ... for certificates ... to meet reasonably projected renewable
portfolio requirements and default service needs to the extent of such requirements." Id. at 13.
DE 10-195 - 5 -
Further, they disagree with the reasoning of Order No. 25,213 that Commission review and
reporting regarding RSA 362-F in 2025 would be a meaningless exercise if their interpretation is
correct. Id. at 13-14.
The Wood IPPs’ second major argument is that Order No. 25,213 unlawfully asserts
jurisdictional authority under RSA 362-F to approve a PPA whose term for the purchase of
RECs and recovery of the costs of those RECs from ratepayers extends beyond 2025. Id. at 15.
They refer both to RSA 362-F:9, I and RSA 374-F:3,V(c),3 which they assert only permits
recovery from ratepayers of costs incurred in complying with RPS requirements.
In addition, the Wood IPPs contend that the Commission lacks authority and jurisdiction
to levelize a projection of PSNH’s REC purchase requirements. Id. at 16-17. They maintain that
the Commission’s efforts to project PSNH's RPS requirements for the 20-year term of the PPA
and then levelize this projection over the entire term was unlawful. They argue that Order No.
25,213 unlawfully allows PSNH to purchase the levelized annual REC amount rather than the
amount of RECs required to meet the statutory compliance requirement applicable to each year
of the PPA term, and then binds ratepayers to fund the purchase of RECs not required for
compliance with PSNH’s RPS requirements.
The Wood IPPs further contend that the Commission lacks authority and jurisdiction to
approve change in law provisions in an agreement under RSA 362-F that fail to give effect to the
Commission’s authority under RSA 365:28 (Commission authority to alter orders after notice
and hearing). Id. at 17. The change in law provisions referred to here are sections 1.44, 1.57,
3 The relevant part of RSA 374-F:3,V(c) is the provision that “[a]ny prudently incurred costs arising from
compliance with the renewable portfolio standards of RSA 362-F for default service or purchased power agreements
shall be recovered through the default service charge.”
DE 10-195 - 6 -
8.1, and 23.1 of the PPA. The Wood IPPs argue that Order No. 25,213 effectively asserts its
right to waive or ignore, or not apply the plain meaning of RSA 365:28 and that RSA 362-F,
374-F:3, V(c), and 365:28, read in pari materia, prohibit the Commission from creating nonmodifiable
REC purchase requirements and insulating the contracting parties from future
legislative action, at ratepayers' expense. Id. at 17-18. They further maintain that these three
statutes are readily harmonized, Id. at 19, and state that unlike the RPS programs in other states,
New Hampshire did not provide for vesting of statutorily-created REC purchase obligations
underlying multi-year REC purchases and recovery of related costs. Id. at 20.
Finally, they contend that certain provisions of the PPA, i.e., sections 1.8, 1.44, and 1.57,
unlawfully require the present approval of the purchase of, and cost recovery for, RECs produced
by the Laidlaw facility notwithstanding any future legislative or regulatory changes that would
revise, replace or displace the New Hampshire RPS program and New Hampshire RECs, at
prices that may not be permissible under the New Hampshire RPS, if the statute is amended,
repealed, or displaced. Id. at 21-22. They reiterate that nothing in RSA 362-F:9, I or RSA 374-
F:3, V(c) allows the Commission to authorize the purchase or cost recovery for anything but the
costs of compliance with the New Hampshire RPS statute. Id. at 22.
B. Objections to Motion for Rehearing
PSNH objects to the Wood IPPs’ motion for rehearing on grounds that the motion merely
revisits issues and arguments that the Commission has already considered. PSNH contends that
the Commission reviewed and considered the first two of the Wood IPPs’ claims, i.e., the “2025”
issue and the RSA 365:28 issue, in Order No. 25,213 and Order No. 25,192. PSNH Objection at
DE 10-195 - 7 -
1-2. PSNH asserts that the Wood IPPs raised these claims in at least four other filings in this
proceeding. Id. at 3-4.
As to the Wood IPPs’ claim that the Commission lacks authority and jurisdiction under
RSA 362-F to levelize a projection of PSNH's REC purchase requirements, PSNH argues that
the claim is legally incorrect because RSA 362-F:9 expressly recognizes that there may be
different ways to “approach” implementation of the RPS requirements and the Commission is
granted authority to review and approve multi-year purchase agreements with renewable energy
sources “if it finds such agreements or such an approach, as may be conditioned by the
commission, to be in the public interest.” Id. at 2, 6. In particular, PSNH states that in Order
No. 25,213 the Commission determined that an appropriate methodology to meet the law’s
public interest requirement was to set a certain level of REC purchases over the life of the PPA,
an approach deemed by the Commission to be in the public interest to meet reasonably projected
RPS needs over the long-term. In PSNH’s view, the RPS law does not require that such
reasonably projected RPS needs be done on a day-by-day, month-by-month, year-by-year, or
decade-by-decade basis; rather, the Commission has the power to carry into effect the provisions
of RSA Title XXXIV, including RSA 362-F, as part of its general supervisory authority granted
by RSA 374:3. Finally, PSNH reiterates its objection to the granting of intervenor status to the
Wood IPPs and requests that we reverse our approval. Id. at 7.
Like PSNH, the City of Berlin maintains that the “2025” issue was argued extensively
during the hearings on the PPA and the Commission appropriately decided the issue in Order No.
25,213. City of Berlin Objection at paragraph 7. Berlin further contends that the additional
legislative history relied upon by the Wood IPPs in their motion for rehearing is not new
DE 10-195 - 8 -
evidence given that all such legislative history was available to them and they failed to raise this
issue. Berlin maintains that reopening this matter and thus stalling the approval of the PPA for
no valid reason, would have serious economic risks. Paragraph 8. Finally, Berlin states that
PSNH has timely filed a revised PPA that conforms to Order No. 25,213. Paragraph 11.
C. Commission Analysis
Pursuant to RSA 541:3, the Commission may grant rehearing or reconsideration when a
party states good reason for such relief. Good reason may be shown by identifying new evidence
that could not have been presented in the underlying proceeding, see O’Loughlin v. N.H.
Personnel Comm’n 117 N.H. 999, 1004 (1977), or by identifying specific matters that were
“overlooked or mistakenly conceived” by the deciding tribunal. Dumais v. State, 118 N.H. 309,
311 (1978). A successful motion for rehearing does not merely reassert prior arguments and
request a different outcome. See Connecticut Valley Electric Co., Order No. 24,189, 88 NH
PUC 355, 356 (2003), Comcast Phone of New Hampshire, Order No. 24,958 (April 21, 2009) at
6-7 and Public Service Company of New Hampshire, Order No. 25,168 (November 12, 2010) at
10.
First, we reject PSNH’s assertion that the Wood IPPs should not have been granted
intervention. PSNH has demonstrated no new evidence or matters that were overlooked or
mistakenly conceived when we granted the Wood IPPs intervention status.
The major arguments advanced by the Wood IPPs in their first motion for rehearing were
included in their closing statement. The arguments made in the Wood IPPs’ motion for
rehearing are largely the same as those they made previously, and were ruled on in Order No.
25,191 at 4-8 and Order No. 25,213 at 70-77, with the exception of the levelization arguments,
DE 10-195 - 9 -
which are discussed below. The Wood IPPs have not identified any new evidence regarding the
“2025” or RSA 365:28 issues that were not and could not have been presented in the underlying
proceeding. Neither have they identified matters that were “overlooked or mistakenly
conceived” as would warrant a new hearing or reversal of prior rulings.
The only new argument advanced by the Wood IPPs relates to their claim that the
Commission lacks authority and jurisdiction to levelize a projection of PSNH’s REC purchase
requirements. The argument is new because it relates to a condition to approval of the PPA
established in Order No. 25,213, stating that:
there need not be an exact match in each year of the PPA between the Class I RECs
expected to be produced by the Laidlaw facility and PSNH’s unsatisfied renewable
portfolio requirement. Doing so would not be realistic, as the REC requirement ramps up
over time but a new facility brings on a large influx of renewable generation at the
moment it becomes operational. REC agreements that limit purchases to the REC
requirement for each particular year would make financing of these projects difficult and
could, in effect, deter desirable renewable energy generation projects from being
approved and built, a result that we find contrary to legislative intent. Instead, we view
the REC requirement in the context of the 20-year period covered by the PPA . . . .
PSNH’s reasonably projected Class I REC requirement is 7,960,000, or approximately 8
million certificates, over the 20-year term of the PPA. Given the increasing REC
obligation over time, in the early years of the agreement the RECs generated by the
project will be in excess of the statutory requirement while in the later years the RECs
generated by the project will be less than the statutory requirement. We find that it is in
the public interest pursuant to RSA 362-F:9 to approve a multi-year purchase agreement
that levelizes the REC purchase requirement over time. Id. at 84, 95
Consistent with this conclusion, the Commission approved a condition to approval of the PPA
that imposes a ceiling on PSNH’s REC purchase obligation of 400,000 RECs per year on a
levelized basis. Id. at 95. At the same time, we stated that RECs produced by Laidlaw above
this ceiling could be purchased by any entity requiring RECs, at market prices or pursuant to a
separate contract that Laidlaw might negotiate with a buyer. Id.
DE 10-195 - 10 -
After review of the Wood IPP arguments, we conclude that we have authority under RSA
362-F to levelize a projection of PSNH’s REC purchase requirements as part of the public
interest determination under RSA 362-F:9 for the reasons set forth in Order No. 25,213 and in
PSNH’s objection to the Wood IPPs’ motion for rehearing. We find no basis to conclude that the
“reasonably projected renewable portfolio requirements” referred to in RSA 362-F:9, I must
necessarily be determined on an annual basis as a matter of law. That is not an express
requirement of the statute and as the agency responsible for determining whether to approve a
multi-year purchase agreement under RSA 362-F:9, the Commission has latitude to decide
whether “projected renewable portfolio requirements” are or are not “reasonable.” In this
proceeding, we have applied our best judgment in doing so. Ultimately, the judgments to be
made affect the rates customers will be required to pay and the appropriate extent to which
investment in renewable energy generation is to be stimulated. These are the kind of choices the
Commission has traditionally been called on to make. See Appeal of Verizon New England, Inc.,
153 N.H. 50, 56 (2005).
We note further that RSA 362-F contemplates situations where “excess” RECs are
acquired. For example, under RSA 362-F:7, I, unused REC certificates4 issued for production
during the prior two years may be “banked” and later used to meet up to 30 percent of a
provider’s requirements for the current year of compliance.5 This being the case, it is clear that
the Legislature envisioned the possibility of the accumulation of excess RECs to a limited extent.
4 An unused certificate is one that is not used for compliance with RSA 362-F in the year in which it is produced.
5 Alternatively, the excess RECs can be sold to other providers for their compliance purposes, with any resulting
revenues being included in the calculation of energy service rates.
DE 10-195 - 11 -
III. EDREST PROPERTIES
Edrest asks that it be permitted to terminate its previously filed motion for rehearing. The
gist of Edrest’s motion for rehearing is that significant changes to the plant’s ownership structure
and fuel supplier occurred since the issuance of Order No. 25,213 and that these changes can
significantly affect whether the PPA is in the public interest. Both PSNH and the City of Berlin
objected to Edrest’s motion for rehearing.
Edrest gives no reason for the requested “termination” which we construe to be the same
as withdrawal. We find no reason to reject the request and will treat the motion as withdrawn.
Though Edrest’s motion is withdrawn, however, we note that one of Edrest’s issues, the change
in ownership structure of the biomass plant, is pending before the Site Evaluation Committee
(SEC).
IV. DETERMINATION OF COMPLIANCE
A. OCA Letter
The OCA states that section 6.1.3 of the Amended PPA is inconsistent with Order No.
25,213 in that it obligates PSNH’s ratepayers to pay for 100% of the output of the plant contrary
to the order, which limits energy purchases to 500,000 MWh per year. In addition, the OCA
states that this provision improperly requires ratepayers to carry the costs of any overpayment of
energy over 500,000 MWh for a year. The OCA further states that to be consistent with the
order, section 6.1.4 of the Amended PPA should make clear that “excess cumulative reduction”
is a subset of “cumulative reduction” that will serve to reduce the purchase price of the Laidlaw
facility as provided in the Purchase Option Agreement (POA) and the Amended PPA should be
revised to add a statement that if the reduction in the purchase price does not serve to refund the
DE 10-195 - 12 -
“excess cumulative reduction,” then Laidlaw must reimburse PSNH the excess cumulative
reduction in cash. The OCA also questions why there is no security for the “excess cumulative
reduction.” Finally, the OCA states that the Amended PPA does not contain a provision that the
PPA be revised “to add a provision that expressly recognizes the Commission’s retention of such
traditional regulatory authority” as required, see Order No. 25,213 at 98.
B. PSNH Response
PSNH disputes the OCA’s assertions. Regarding section 6.1.3 of the Amended PPA,
PSNH states that its obligation to pay contract rates for energy is limited to an annual purchase
obligation of 500,000 MWhs, thus constraining the potential impact as required by Order No.
25,213. PSNH further relies on the reasoning and methodology contained in its May 18, 2011
letter to address the OCA’s concern.6 As to carrying costs borne by ratepayers, PSNH questions
whether the 500,000 MWh cap would ever be exceeded and even if so, the cap would only be
exceeded late in an operating year resulting in a short carrying period and minimal carrying
costs.
Regarding the issue of the “excess cumulative reduction” raised by the OCA, PSNH
states that the Amended PPA adequately addresses the possibility that PSNH would purchase the
6 In that letter, PSNH explained that,
PPA pricing will apply to no more than 500,000 MWhs of energy per year. Any additional energy
produced by the Facility will be priced at the “Average LMP Price,” thus making PSNH’s customers
indifferent to such purchases. The design of this provision is intended to ensure that both the Facility
owners and PSNH’s customers are treated fairly and equitably under the PPA, with no possibility of
“gaming” purchases or plant operations to favor one party over the other. For example, if the contract
language specified that purchases by PSNH ceased entirely once the 500,000 MWh sales cap was reached,
the developer would have the theoretical opportunity to adjust the timing of the Facility’s In-Service Date
to just after the winter or summer peak periods. That would maximize energy sales to PSNH during lower
cost spring and fall periods to the detriment of PSNH’s customers and allow the developer to benefit by
selling any generation in excess of the 500,000 MWh cap to the market at the end of an “Operating Year”
which would occur during a high cost winter or summer period.
DE 10-195 - 13 -
Laidlaw facility. PSNH refers to section 6.1.4(a) of the Amended PPA, which would be used to
adjust the price of any facility purchase option by PSNH pursuant to Article 7, if the POA were
exercised, and section 6.1.4(c), which states that the energy credit mechanism only applies to any
“excess cumulative reduction” “at the end of any Operating Year other than the last Operating
Year during the Term….”.
PSNH responds to the OCA’s question about the lack of security for the “excess
cumulative reduction” by stating that it represents an untimely request for rehearing under RSA
541:3 and that, in any event, for every year of the contract except for the last operating year, the
value of the facility’s energy generated during the following year provides security for crediting
any “excess cumulative reduction” to customers. Finally, with respect to the OCA’s assertion
regarding the need to expressly recognize the Commission's retention of its traditional regulatory
authority, PSNH states that section 24.1(ii) expressly provides that the Amended PPA does not
prevent PSNH from seeking NHPUC review or approval of any material discretionary actions to
be taken by PSNH in performing under the agreement, such as PSNH’s exercise or transfer of
the POA, transfer of the cumulative reduction, transfer of the right of first refusal, or incurrence
of expenditures under Article 8 hereof. Thus, according to PSNH, the Amended PPA complies
with the terms of Order No. 25,213.
C. Commission Analysis
We have reviewed the Amended PPA and the written comments of PSNH and the OCA
to determine whether the Amended PPA complies with the terms of Order No. 25,213. To the
extent set forth below, we accept the Amended PPA as being in compliance with Order No.
DE 10-195 - 14 -
25,213. The new provision in section 6.1.3 regarding energy purchases in excess of 500,000
MWhs per year, however, is an extraneous provision. In Order No. 25,213, we stated:
[g]iven the likely variations in net output and capacity factor under actual operating
conditions, and to constrain the potential impact on ratepayers, we condition approval of
the PPA on an annual output purchase obligation of 500,000 MWh. Additional output
could be purchased by any market participant, at market prices or pursuant to a separate
contract that Laidlaw might negotiate with a buyer. Id. at 96. (emphasis added)
By contrast, the Amended PPA does not contain this limitation. Instead, section 6.1.3
inserts in this PPA, rather than in a separate contract, a pricing mechanism for energy deliveries
in excess of 500,000 MWh per year, under which such excess deliveries are purchased, at the
Average LMP Price as defined in new section 1.5. While we do not reject the PPA for inclusion
of this provision, we do not approve any mandate that PSNH purchase more than 500,000 MWhs
in any given year; neither do we pre-approve recovery of the costs of such excess purchases as
part of this proceeding. If PSNH purchases more than 500,000 MWhs in any given year, it will
have to demonstrate in future annual energy service reconciliation proceedings that such
purchases were prudently undertaken and were reasonable in amount and price, in the same way
other supplemental power purchases are reviewed by the Commission.
The OCA raises certain other issues in addition to the question of whether section 6.1.3
complies with Order No. 25,213. Regarding OCA’s requested clarification that “excess
cumulative reduction” be considered a subset of “cumulative reduction” that will serve to reduce
the purchase price of the Laidlaw facility as provided in POA, the Amended PPA is clear enough
that both excess and non-excess cumulative reduction will reduce the purchase price in the event
the POA is exercised. As to the question of adding a statement to the Amended PPA providing
that if the reduction in the purchase price does not serve to refund the “excess cumulative
DE 10-195 - 15 -
reduction,” then Laidlaw must reimburse PSNH the excess cumulative reduction in cash, such a
provision would go beyond the terms we established in Order No. 25,213. There may be some
risk that excess cumulative reduction amounts generated during the last contract year are not
reimbursed, but that risk has been substantially reduced from the proposal as originally filed.
Similarly, Order No. 25,213 did not require the Amended PPA to include security for the “excess
cumulative reduction,” nor did it require payment of carrying costs of any overpayment of
energy over 500,000 MWh for a year. Finally, the Amended PPA does not need additional
language recognizing the Commission’s retention of its traditional regulatory authority. That
authority remains as stated in Order No. 25,213.
Based upon the foregoing, it is hereby
ORDERED, the motion for rehearing filed by the Wood IPPs is denied; and it is
FURTHER ORDERED, that Edrest’s request to terminate its previously filed motion
for rehearing is granted; and it is
FURTHER ORDERED, that the Amended PPA is approved except to the extent set
forth above; and it is
FURTHER ORDERED, that PSNH file with the Commission an executed copy of the
Amended PPA in the event the SEC approves a change in ownership structure from that reflected
in the Amended PPA.
DE 10· 195 - 16-
By order of the Public Utilities Commiss ion of New Hampshire this twenty-thi rd day of
June, 2011.
k l~ Amy L. Ig !iUS
Commissioner
Attested by:
Concurring and Dissenting Opinion of Commissioner Below
I concur with the majority in all respects except with regard to its analys is and conclusion
concerning the "2025" issue. Consistent with the reasoning set forth in my previous dissent on
the question of whether a New Hampshire RPS compliance obligation persists beyond 2025, I
would grant the Wood [pP's motion for rehea ring on this issue on the basis that the majority
misconstrued the law on this matter.
(~c:Cb~
Con C. Below
Commissioner
Posted by: wood burner | June 23, 2011 at 07:08 PM
Have the IPP's indicated that they were prepared to go to court?
Posted by: Rocky | June 23, 2011 at 07:55 PM
LOL, Keep your ears clean Rocky.
Posted by: wood burner | June 23, 2011 at 07:58 PM
Yes, Rocky they have. However, you have to think there is plenty of back room dealing going on to try to settle this and move on. We shall see...
Hey, they found Whitey, so anything is possible, I suppose.
Posted by: Antonio Andolini | June 23, 2011 at 08:04 PM
Whitey......what can you do to a 81 year old man that mother nature isn't either already doing or will do to him?
Posted by: Rocky | June 23, 2011 at 09:41 PM